| 30th October - Mobile networks will provide coverage to 90%
of the world’s population by 2010, compared with 80% today,
despite the misplaced policies of many governments, who continue
to subsidize the rollout of fixed-networks, according to a study
commissioned by the GSM Association, the global trade association
for mobile operators.
The study, covering 92 developing countries, examined the
collection and use by governments of universal service fund
levies. It found that governments had collected more than
$6 billion from the telecoms industry, of which $2 billion
has come from mobile operators. Of the $1.5 billion that has
been distributed so far, just 5% ($75 million) has been used
to extend mobile coverage, despite the distinct cost advantages
of mobile technologies. The World Bank has estimated that
the capital cost of providing mobile coverage to an individual
is one-tenth of the cost of installing a fixed-line connection.
Universal service funds are typically designed to provide
governments with the resources to extend basic telecommunication
facilities to the least privileged in society and to those
living in the most remote areas. Despite the critical role
telecoms plays in developing markets, the study by Intelecon
Research found that governments have yet to allocate $4.4
billion of the $6 billion collected by these funds.
If governments allocated the unspent $4.4 billion to extending
mobile networks, an additional 450 million people in rural
areas of the developing world would have mobile coverage,
the study concluded.
“While extending coverage is important, governments
should also focus on connecting the 2.7 billion people who
already have coverage, but are not connected, by removing
mobile-specific taxes and regulations that make mobile ownership
more expensive than it needs to be.” said Tom Phillips,
Chief Government and Regulatory Affairs Officer of the GSMA.
“While the mobile industry is reducing costs for its
customers through shared access initiatives and the development
of low-cost handsets, many governments are increasing the
burden of regulation.”
Intelecon found that 32 of the 92 countries in the survey
have set up universal service funds, levying fees, ranging
from 1% to 6% of operators’ revenues. Malaysia, for example,
takes 6% of operators’ revenue, while India, which levies
5%, has built up a fund of almost $2 billion that is earmarked
entirely for extending fixed networks. Brazil levies 1%, but
has yet to spend any of the $1.7 billion it has collected.
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